Weekly Market Insight

Latest Economic & Market Update 8th December 2020

08th December 2020

Good afternoon, it is December 8th 2020 and here is your economic and market update from BlackBee. 

Today’s focus:

  • Sterling weakens as No-Deal Brexit creeps closer
  • Housing supply unlikely to meet the demand for next 3 years – Banking and Payments Federation Ireland (BPFI)
  • Another BlackBee product generates a positive return for Investors

Sterling traded at a six-week low against the Euro on Monday as Brexit talks enter what is believed to be the final week. The currency dropped to 1.1050 yesterday and the weakening has continued into Tuesday, trading at 1.1013 as at 9am. Time is running out for a deal to be agreed; Taoiseach Micheál Martin told RTÉ “My gut instinct is that it’s 50-50 right now and I don’t think one can be overly optimistic about a resolution emerging”. Boris Johnson has headed to Brussels to meet face to face with Ursula von der Leyen as discussions between current chief negotiators David Frost and Michel Barnier remain at loggerheads. The critical differences are on level playing field, governance and fisheries. A No-Deal Brexit, compounded by the economic chaos after the coronavirus, could have serious implications on any future legacy that Boris Johnson wishes to have, perhaps this is the best hope for a compromise to be agreed. (Data source: Bloomberg)

Housing output is unlikely to reach the required levels until the end of 2023, according to Dr Ali Uğur, Chief Economist of BPFI. A 2020 slowdown in both completions and commencements are cited as the main drivers of the output backlog. Completions for the first 9 months of 2020 were 10% lower than the same period in 2019 while the shortfall of commencements this year will have a knock-on effect for 2021 and beyond. For the first 8 months of 2020, commencements were 24% lower than the same period in 2019. The current and pent up demand in Ireland is estimated to be around 35,000 units. BlackBee is committed to increasing supply lines through the firm’s social housing strategy. By refitting and refurbishing existing housing units that were built prior to Ireland’s property crash in the late 2000s, BlackBee believes that this strategy tackles an important issue in Irish society. By targeting 25-year government leases on the properties, this would also create opportunities for investors.

BlackBee’s Twin-Win Series 4 (Technology) has matured early, after 1.5 years, returning 15% for investors. 

Best & Worst Performers of Large Cap US Stocks on Monday
Click image to enlarge

Global Market Update
(as at close of markets 07/12/2020)